Essex Property Trust Inc. ESS reported third-quarter 2024 core funds from operations (FFO) per share of $3.91, which beat the Zacks Consensus Estimate of $3.88. The figure also improved 3.4% from the year-ago quarter.
Stay up-to-date with all quarterly releases: See Zacks Earnings Calendar.
Results reflect favorable growth in same-property revenues and net operating income (NOI). ESS also raised its full-year 2024 guidance.
Total revenues of $450.7 million outpaced the Zacks Consensus Estimate of $445.9 million. Revenues were up 7.5% year over year.
Essex Property Trust, Inc. Price, Consensus and EPS Surprise
Essex Property Trust, Inc. price-consensus-eps-surprise-chart | Essex Property Trust, Inc. Quote
Essex Property’s Q3 in Detail
In the third quarter, Essex Property’s same-property revenues increased 3.5% from the prior-year period. However, same-property operating expenses rose 5.5% year over year.
Same-property NOI jumped 2.6% year over year. Financial occupancies of 96.2% in the third quarter contracted 20 basis points (bps) year over year and remained unchanged sequentially. Our estimate for the metric stood at 96.4%.
The year-over-year blended rate growth for the third quarter of 2024 came in at 2.5% compared to 3.4% achieved in the second quarter of 2024.
During the quarter, Essex acquired and consolidated two joint venture apartment home communities in San Jose, CA, at a combined valuation of $290.5 million on a gross basis.
Essex Property’s Balance Sheet
Essex Property exited the third quarter of 2024 with cash and cash equivalents, including restricted cash, of $80.2 million, up from $64.2 million recorded at the end of the second quarter of 2024. ESS had $1.2 billion in liquidity through the undrawn capacity on its unsecured credit facilities, cash and cash equivalents and marketable securities as of Oct. 28, 2024.
The company ended the quarter with a total net debt of $6.37 billion and net debt-to-Adjusted EBITDAre of 5.5X. ESS ended the quarter with a weighted average interest rate of 3.6% and a weighted average years to maturity of 7 years.
Essex Property’s 2024 Guidance
For the fourth quarter of 2024, Essex Property projects core FFO per share in the range of $3.82-$3.94, with the midpoint being $3.88. The Zacks Consensus Estimate is pegged at $3.89.
For 2024, the company revised the core FFO per share guidance to the range of $15.50-$15.62, with the midpoint being $15.56, from the earlier range of $15.38-$15.62. The Zacks Consensus Estimate of $15.55 stands within this range.
ESS now projects same-property revenue growth on a cash basis in the range of 3.1%-3.4%, revised from the 2.7%-3.3% range projected earlier. It expects operating expense growth to remain unchanged from the prior guidance range of 4.5%-5%. NOI is projected to grow in the range of 2.3%-2.9%, up from the 1.8%-2.8% band projected earlier.
Essex Property currently carries a Zacks Rank #3 (Hold). You can see the complete list of today’s Zacks #1 Rank (Strong Buy) stocks here.
Upcoming Earnings Releases
We now look forward to the earnings releases of other REITs, such as AvalonBay Communities AVB and Vornado Realty Trust VNO, both of which are slated to report on Nov. 4.
The Zacks Consensus Estimate for AvalonBay’s third-quarter 2024 FFO per share stands at $2.71, indicating a 1.9% increase year over year. AVB currently has a Zacks Rank #2 (Buy).
The Zacks Consensus Estimate for Vornado Realty Trust’s third-quarter 2024 FFO per share is pegged at 51 cents, implying a 22.7% year-over-year decline. VNO currently carries a Zacks Rank #3.
Note: Anything related to earningspresented in this write-up represents funds from operations (FFO), a widely used metric to gauge the performance of REITs.
Zacks Names #1 Semiconductor Stock
It's only 1/9,000th the size of NVIDIA which skyrocketed more than +800% since we recommended it. NVIDIA is still strong, but our new top chip stock has much more room to boom.
With strong earnings growth and an expanding customer base, it's positioned to feed the rampant demand for Artificial Intelligence, Machine Learning, and Internet of Things. Global semiconductor manufacturing is projected to explode from $452 billion in 2021 to $803 billion by 2028.
See This Stock Now for Free >>AvalonBay Communities, Inc. (AVB) : Free Stock Analysis Report
Vornado Realty Trust (VNO) : Free Stock Analysis Report
Essex Property Trust, Inc. (ESS) : Free Stock Analysis Report
To read this article on Zacks.com click here.
The views and opinions expressed herein are the views and opinions of the author and do not necessarily reflect those of Nasdaq, Inc.
